Wacoal Holdings Corp.May 20, 2020
1
Fiscal Year Ended March 31, 2020 Business Results Presentation -Final Version [U.S. Accounting Standards]
US-based Intimates Online, which was acquired as a subsidiary, has been consolidated since the second quarter of this term underreview, and the results are included and disclosed in Wacoal International Corp. (The U.S.) in the overseas Wacoal business segment.(In this presentation, Intimates Online is sometimes referred to as “IO.”)
2
The Group’s business activities have been significantly impacted by the suspension of store operations and curfews for the prevention of the spread of the novel coronavirus. In addition to the continuation of measures to prevent the spread of the infection, sluggish personal consumption caused by the expected worsening of employment and income environments will continue to adversely affect our Group’s management, sales and profit. As it is difficult to assess the impact of the novel coronavirus on the
Group and reasonably forecast the earnings at this moment, we have not yet decided on a consolidated earnings forecast for FY2021, and will announce it as soon as the details become clear.
Full Year Consolidated Business Performance Forecast for FY2021
3
Results of FY2020 4Q (Jan. to Mar.) and Full-Year Business Results
Akira Miyagi
Wacoal Holdings Corp.
Director and Managing Corporate Officer
FY2020 4Q (Jan. to Mar.) Executive Summary
4
Sales declined significantly in Japan, Europe and the U.S. in March due to the spread of the infection.
Net sales and operating income fell short of the revised estimate by ¥4.2 billion and ¥0.4 billion, respectively.
Impairment charge on intangible assets (¥0.5 billion) was posted for Thai material companies (not reflected in the revised estimate).
Operating income fell below the revised estimate despite the efforts to control SG&A expenses. (profit increased from the previous term as the range of impairment charges was reduced.)
¥3.2 billion [Up ¥3.1 billion year on year] [Fell short of the plan total by ¥4.1 billion] [Fell short of the revised estimate by ¥0.4 billion]
Due to the dropped sales, gross margin declined ¥2 billion compared with the revised estimate, and impairment charges amounted to ¥0.5 billion (not reflected in the revised estimate) = Profit declined by ¥2.5 billion.
Reduction in SG&A expenses accompanying the rapid business deterioration, buffers reflected in the revised estimate, etc.= Reduction of approx. ¥2.1 billion. Fell short of the revised estimate by ¥0.4 billion.
Breakdown of intangible assets for the current term (Trademark rights of Peach John: ¥0.2 billion; goodwill of Thai material companies, etc.: ¥0.3 billion)
(Impairment charges of ¥5.8 billion on intangible assets of Peach John, etc., in the same period of the previous year)
Net sales ¥42.7 billion[Down ¥4.2 billion (-9%) year on year] [Reached 86% of the plan total and fell short of it by ¥6.7 billion] [Reached 91% of the revised estimate and fell short of it by ¥4.2 billion]
Business was directly affected by the decrease of customers due to voluntary restraint from going out, a decline in demand from foreign visitors to Japan, and lockdown in major cities overseas.
(Refer to P8 to see the sales conditions of major corporations from Jan. to Mar.)
Slump in consumption after the tax hike, record-breaking mild winter, and the spread of the infection caused the domestic department store channel to struggle significantly.
(Wacoal: Sales at stores in the department stores; March: Down 41%, 4Q: Down 23% (Refer to P39))
Operating loss
(Millions of yen)
Change % Change Change % Change Change % Change Change % Change
Wholesale Business Div. -454 - 2.2% 1,855 +8.2% -2,725 - 13.1% -2,756 - 15.1%
Retail end WEB
Business Department508 +8.7% 560 +9.1% -32 - 0.5% 14 +0.2%
Others 249 ー 68 ー -49 ー -244 ー
Wacoal 303 +1.0% 2,483 +9.1% -2,806 - 10.7% -2,986 - 12.7%
-380 ー -631 ー 405 ー -79 ー
Wacoal Business (Japan) -77 - 0.3% 1,852 +6.0% -2,401 - 8.6% -3,065 - 11.4%
-329 - 6.1% -8 - 0.2% 514 +14.7% 531 +12.0%
Wacoal Europe Ltd. -452 - 11.4% 47 +1.4% -44 - 1.5% -669 - 17.7%
Wacoal China Co., Ltd. -37 - 1.2% -129 - 4.2% -263 - 10.7% -107 - 3.7%
-313 ー -347 ー -453 ー -489 ー
Wacoal Business (Overseas) -1,131 - 7.7% -437 - 3.1% -246 - 2.2% -734 - 5.6%
Peach John Business -120 - 4.4% 116 +4.2% -143 - 5.6% 136 +5.5%●Peach John’s sales were weak, mainly in the Mail Order Business, in the same period
last year. In reaction to this, sales augmented.
Lecien -166 - 11.1% -72 - 4.2% -58 - 4.0% -228 - 14.0%
Nanasai -607 - 23.5% 234 +9.8% -3 - 0.2% -320 - 12.5%
41 ー 2 ー 0 ー -14 ー
Other Businesses -732 - 16.4% 164 +3.7% -61 - 1.6% -562 - 12.5%
Total -2,060 - 4.2% 1,695 +3.2% -2,851 - 6.3% -4,225 - 9.0%
Intersegment transactions,
etc. eliminetions
●The Wholesale Business was affected by the prolonged slump in consumption after
the tax hike and a decrease in the number of customer visits due to the spread of the
infection.
●The WEB Business remained healthy.
●The sales of directly managed retail stores dropped slightly in 4Q due to a decline in
the number of customer visits in March despite the contribution of the opening of new
stores.
●The Wacoal Business (Japan) posted a decrease of \3.1 billion in sales due
to the poor performance of the Wacoal Wholesale Business.
(The decrease in sales in the Wholesale Business for the full year was approx.
\4 billion [down 5%].)
●The sales of IO in 4Q were \0.55 billion.
(Posted approx. 1 million dollars for E-commerce sales adjustments and provisions for
sales returns accompanying accounting integration)
●U.S. Wacoal’s sales in 4Q were at the same level as the previous year on a local
currency basis.
●Sales declined 15% in Europe on a local currency basis because of the struggles in
department stores and the impact of the infection.
●In China, the sales in 4Q (from Oct. to Dec.) increased 2% on a local currency basis.
●The number of orders for Lecien dropped for both product and material businesses.
●Nanasai was affected by the recoil from the completion of delivery of the works in the
same period last year and a decline in the number of orders from customers.
Q4 comments
Net
sales
1Q 2Q 3Q 4Q
Wacoal International Corp.
(U.S.)
Intersegment transactions,
etc. eliminetions
Intersegment transactions,
etc. eliminetions
5
Net Sales per Quarter by Business Segment for FY2020 (YoY Increase/Decrease)
(Reference) The impact of the spread of the infection on sales is estimated to be -¥3 billion.
Change % Change Change % Change Change % Change Change % Change
Wholesale Business Div. 62 +1.5% 1,338 +26.3% -1,522 - 39.1% -1,581 - 69.6%
Retail end WEB
Business Department87 +14.6% 292 +68.9% -148 - 18.4% -153 - 87.4%
Others -533 ー -244 ー -169 ー 612 ー
Wacoal -384 - 22.5% 1,386 +60.7% -1,839 ー -1,122 ー
271 ー 51 ー 283 ー 811 ー
Wacoal Business (Japan) -113 - 5.7% 1,437 +48.4% -1,556 -311 ー
-302 - 25.8% -447 - 61.6% -432 ー -513 ー
Wacoal Europe Ltd. -111 - 24.7% -10 - 2.9% 25 +43.9% -304 - 54.2%
Wacoal China Co., Ltd. -86 - 16.7% -36 - 10.0% -48 ー 180 ー
16 ー 158 ー -206 ー -972 ー
Wacoal Business (Overseas) -483 - 20.6% -335 - 22.4% -661 ー -1,609 ー
Peach John Business -97 ー 11 +8.7% 283 ー 5,311 ー
Lecien 26 ー 45 ー 101 ー -275 ー
Nanasai -99 - 90.8% 82 +86.3% -36 ー -11 - 21.2%
13 ー 14 ー -5 ー 21 ー
Other Businesses -60 ー 141 ー 60 ー -265
Total -753 - 17.1% 1,254 +27.3% -1,874 - 86.0% 3,126 ー
Intersegment transactions,
etc. eliminetions
Intersegment transactions,
etc. eliminetions
Intersegment transactions,
etc. eliminetions
●Gross margin of the Wholesale Business decreased approx. \1.7 billion (a reduction in
expenses by approx. \0.1 billion) as a result of dropped sales.
●Profit declined for the Retail and WEB Businesses in 4Q as SG&A expenses
augmented.
●Despite the efforts to reduce expenses, such as advertising costs and travel expenses,
of the whole company following the spread of the infection, Wacoal’s operating income
fell approx. \1.1 billion in 4Q from the previous year.
●Changes in consolidation adjustments from the previous term (inventory valuation,
retirement benefit expenses, etc.), after posting the impairment charges of Ai in the
previous term
●Profit of the Wacoal Business (Japan) decreased approx. \0.3 billion.
●The operating loss of IO in 4Q was approx. \0.6 billion (including depreciation).
●In Europe, profit dropped as sales fell and SG&A expenses increased.
●In China, the reduction of SG&A expenses due to withdrawal of unprofitable stores
contributed to the increase of profit in 4Q (from Oct. to Dec.).
●Breakdown of impairment charges of the Thai materials companies (property, plant
and equipment of \0.76 billion + intangible assets of \0.28 billion)
●Profit of the Wacoal Business (Overseas) fell approx. \1.7 billion.
●Impairment charges (\0.19 billion) were posted for Peach John on its trademark
rights.
(Profit grew after posting the impairment charges of \5.64 billion on intangible assets in
the previous term).
●Suspension of publication of catalogs and store withdrawals caused Peach John’s
profit to increase in Japan, but its profit overseas was sluggish.
●Lecien posted business restructuring costs for withdrawal of some businesses.
Operating
income
1Q 2Q 3Q 4QQ4 comments
Wacoal International Corp.
(U.S.)
6
Operating Income per Quarter by Business Segment for FY2020 (YoY Increase/Decrease)
(Reference) A decline of about ¥1.5 billion is expected in the gross profit rate due to the spread of the infection.
(Millions of yen)
Change % Change Change % Change Change % Change
Wholesale Business Div. -51 - 1.1% -162 - 2.8% -2,544 - 32.7%
Retail Business Div. 67 +3.6% 9 +0.9% -163 - 11.5%
WEB Business Dept. 54 +9.3% 37 +5.3% 11 +1.8%
* Increase / decrease rate only for in-house EC in WEB business Dept. +13.7% +15.4% +21.1%
Wacoal(★2) -58 - 0.9% -133 - 1.8% -2,280 - 29.2%
Peach John(Japan) 151 +17.5% 125 +20.6% -119 - 14.1%
Ai -2 - 1.1% -14 - 7.5% -74 - 34.9%
Lecien(Japan) 13 +2.4% -90 - 14.1% -120 - 14.8%
Nanasai -117 - 23.1% -57 - 7.9% -345 - 19.0%
982 +9.1% 425 +2.6% -1,539 - 10.8%
* Among Wacoal America, Inc.,
the rate of increase/decrease in EC sales including own and other company. +16.7% +34.5% +14.3%
-806 - 9.6% 721 +8.8% -3,955 - 39.9%
★1 The figure before the transfer of internal expenses.Shows year-on-year changes, including internal sales.
★2 In addition to the three businesses listed, the figures include sales of other businesses and eliminations between business divisions.
★3 The figures for Wacoal America only are disclosed. It is not the figures of sales of Wacoal International including Intemate Online inc.(LIVELY).
Wacoal America, Inc.(★3)
(Local Currency Basis USD'000)
Wacoal Europe Ltd.
(Local Currency Basis GBP'000)
Net sales★1
Jan. Feb. Mar.
7
(Reference) Net Sales from Jan. to Mar. by Major Corporations for FY2020 (YoY Increase/Decrease)
Sales declined significantly in March. EC sales increased but failed to make up for the sluggish growth of physical stores.(See P46 for EC sales ratio by country.)
8
An extremely tough year due to the slump in personal consumption after the tax hike, mild winter and the spread of the infection
Net sales: -¥7.4 billion <Wacoal Business (Japan): -¥3.7 billion
Wacoal Business (Overseas): -¥2.5 billion, out of which, foreign currency translation amount is ¥1.8 billion>
Operating income in real terms(*): -¥3.6 billion <Wacoal Business (Domestic): -¥0.5 billion Wacoal Business (Overseas): -¥3.1 billion>
(*) Impairment charges on goodwill and other intangible assets are excluded in the figures.
Income before taxes ¥4.4 billion [Up ¥2.2 billion (98%) year on year] [Reached 36% of the plan total and fell short of it by ¥7.6 billion] [Reached 46% of the revised estimate and fell short of it by ¥5.1 billion]
Operating income ¥6.6 billion [Up ¥1.8 billion (36%) year on year] [Reached 60% of the plan total and fell short of it by ¥4.4 billion][Reached 95% of the revised estimate and fell short of it by ¥0.4 billion]
The U.S.: Down ¥1.7billion: Operating loss of IO: ¥ 1.25 billion; one-time expense related to acquisition: ¥0.2 billion; reduced profit of existing businesses, etc.
Europe: Down ¥0.4 billion: Profit declined with the enhancement of advertising activities to increase brand recognition and establishment of the in-house EC website.
Overseas and others: Down ¥1 billion: Posting of ¥0.8 billion of impairment charges on property, plant and equipment of Thai material companies, etc.
Valuation gain (loss) on marketable securities and investments for the current term: -¥3.8 billion (a loss of ¥5.6 billion in the previous term: Up ¥1.8 billion)
Increase in retirement benefit expenses (¥1.2 billion)
Net sales ¥186.8 billion [Down ¥7.4 billion (-4%) year on year] [Reached 93% of the plan total and fell short of it by ¥13.2 billion] [Reached 98% of the revised estimate and fell short of it by ¥4.2 billion]
Sales grew in the Wacoal Retail and Web Businesses (¥1.1 billion) while sales declined in the Wholesale Business significantly (-¥4.1 billion).
The main wholesale channels remained sluggish through the second half due to prolonged slump in consumption after the tax hike (Wholesale Business: First half: ¥1.4 billion; second half: -¥5.5 billion)
In the overseas business, the newly-consolidated IO contributed (¥1.3 billion), but sluggish Thai material companies reduced sales.
Executive Summary of FY2020
*Unrealized valuation gain (loss) on marketable securities and investments is not reflected in the plan total and revised estimate.
Operating income in real terms excluding impairment charges on goodwill and other intangible assets: ¥7.1 billion[Down ¥3.6 billion (-34%) year on year] [Reached 65% of the plan total and fell short of it by ¥3.9 billion]
9
YoY Increase/Decrease in Net Sales for FY2020
Net Sales: Down approx. ¥7.4 billion
(About ¥1.8 billion effect from foreign currency translation)
WacoalWholesale
-4.1
WacoalRetail and
Web Businesses
+1.1
Wacoal other
businesses Deletion of
inter-department transactions
-0.1
The U.S.+1.1
Europe-0.4
China+0.1
Other overseas
corporations-1.5
PJAlmost the same as
previous year
Nanasai-0.7
Lecien-0.5
Ai-0.6
Other subsidiaries
and settlement adjustment
+0.1
FY3/19
¥194.2billion
FY3/20
¥186.8billion
(billion of yen)
For directly managed retail stores and in-house e-commerce, recoil was minimized.
Effect from completion of large-scale construction in the same period of previous year
Exchange fluctuations
-1.8
Hong Kong Wacoal: -0.6(Stagnant sales and impact of changes in transaction conditions for PJ business)Slump in Thai material companies: -1.0
Wing underwear: +0.1Wacoal brand underwear: -2.3Nightwear (pajamas): -0.7CW-X, etc.: -1.7Sales of the above products on in-house e-commerce: +0.4
Consolidation effects from IO (¥1.3 billion), but sales of existing businesses decreased
Stagnation due to bad weather during peak season (July)
Shrunk material business, etc. intentionally
Declined sales in 4Q due to the spread of the infection (steady sales until 3Q)
10
Net Sales Progress for FY2020
Net Sales: Missed the estimate at ¥13.2 billion (About ¥1.5 billion effect from foreign currency translation)
Missed the revised estimate at ¥4.2 billion
Wacoal-6.1
Other domestic
corporations/Consolidation adjustment
-2.2
The U.S.+0.6
Europe-1.0
China-0.9
Other overseas
corporations-2.3 Other overseas
corporations+0.3
China-0.2
Europe-0.7
The U.S.-0.4
FY3/20estimate
¥200billion
FY3/20
¥186.8billion
Sluggish sales in March due to the spread of the infection(fell short of the revised estimate largely)(Japan) Wholesale: -2.9Retail and Web: -0.4(Overseas)The U.S.: -0.4Europe: -0.7
Exchange fluctuations
-1.4
Slump in Thai material companies: -1.2Other subsidiaries: -0.5Failure to meet overseas business expectations: -0.6
Wholesale Business: -5.0Wacoal underwear: -2.7Products other than underwear: -2.6
Retail and Web Businesses: -0.4Plan achieved on in-house e-commerce
Other businesses/deletion of inter-department transactions: -0.6
Consolidation effects from IO, but existing businesses missed the estimate
Companies fell short of the estimate due to business downsizing for improvement of earnings and bad weatherPJ: -1.1Nanasai: -0.1Lecien: -0.8Ai: -7
Settlement adjustment:+0.5(Decrease in provisions for sales returns , etc.)
FY3/20revised
estimate
¥191billion
Wacoal-3.2
Other domestic
corporations/Consolidation adjustment
±0
Status against the estimate Status against the revised estimate
Europe saw stagnant sales in the U.K. Brands except Wacoal struggled in China
Fell short of the estimate by 6 million yen on a local currency basis (+foreign exchange impact)
(billion of yen)
11
FY3/19
¥4.9billion
Wacoal Wholesale
-1.7
Wacoal Retail and
Web Businesses
+0.1
Wacoal back-office SG&A
-.3
The U.S.-1.7
Europe-0.3
China+0.1
Other overseas
corporations-0.7
Total of 4 domestic
subsidiaries-0.1
Other subsidiaries
and settlement adjustment
+1.2
FY3/20
¥6.6billion
Exchange fluctuations
-0.1
Operating loss of IO: -1.2(Includes depreciation of intangible assets: -0.2)M&A expenses: -0.2Decreased profit from existing businesses, etc.
Operating Income in Real Terms: Down ¥3.6 billion
Wacoal: -2.0Decrease in net sales: -1.0Increase in IT system related expenses: +0.5Increase in labor expenses(*): +0.6Curtailment of advertising costs: -0.3, etc.
*Changes in profit of Wholesale Business(Apr. to Sep.: +1.4)(Oct. to Dec.: -1.5)(Jan. to Mar.: -1.6)
YoY Increase/Decrease in Operating Income for FY2020
Settlement adjustment of retirement benefit expenses, inventory valuation, etc., and the effect of posting impairment charges (Ai) in the previous term
Impairment charges on intangible
assets posted in the
previous term
¥5.8billion
Operating income in
real terms in FY3/19
¥10.7billion
Operating income
in real terms for
FY3/20
¥7.1billion
Impairment charges on intangible
assets posted during the term
¥0.5billion
*Increase in labor expenses due to a review of Wacoal’s retirement benefit expenses: +0.7The expenses other than service costs
were posted in non-operating expenses, through settlement adjustment.
Sales declined and operating expenses increased
Impairment charges on intangible assets posted at Thai material companies(Impairment charges on intangible assets are summarized on the right side)
(billion of yen)
12
FY3/20estimate
¥11billion
Wacoal-1.2
4 domestic subsidiaries including PJ
-1.3
The U.S-1.3
Europe-0.1
China+0.2
Other overseas
corporations-1.2
4 domestic subsidiaries including PJ
-0.3
Wacoal-0.8
China+0.1
The U.S+0.3
Other subsidiaries
and settlement adjustment
+0.6
Impairment charges on trademark rights of Peach John, etc.
FY3/20
¥6.6billion
Exchange fluctuations
-0.1
Operating loss of IO: -1.2(Includes depreciation of intangible assets: -0.2)
Operating Income: Missed the initial estimate at ¥4.4 billion(About ¥0.1 billion effect from foreign currency translation)
Missed the revised estimate at ¥0.4 billion
Lecien・Expenses for withdrawal from some Lecien businessesPJ・Stagnant businesses in China・Impairment charges posted
Operating Income Progress for FY2020
Thai material companies did not achieve the estimate: -0.3Additionally, impairment charges posted on property, plant and equipment, and intangible assets.
Status against the estimate Status against the revised estimate
FY3/20 revised
estimate
¥7billion
Europe-0.1
Other overseas
corporations0.-1
Other subsidiaries
and settlement adjustment
+0.5
Decline in sales in 4Q impactedPlan not achieved significantly despite the efforts to reduce SG&A expenses
Decline in contingent consideration accompanying the acquisition of IO: -0.3 (reverted to SG&A expenses)
Budget buffer
Distribution, factories, etc. exceeded the estimate. Settlement adjustment of inventory valuation, etc.
Wacoal: -1.2Gross margin not achieved: -2.5Operating expenses reduced: -1.3(Labor expenses: -0.3; advertising and other costs: -1.0)
*Wholesale Business: Profit fell short of the estimate by -1.8(Apr. to Sep.: +0.3)(Oct. to Dec.: -0.3)(Jan. to Mar.: -1.8)*Retail and Web achieved the estimate.
(billion of yen)
% Of
sales
% Of
sales
% Of
sales
% Of
salesChange % Change Change % Change Change % Change
10,713 5.5 7,105 3.8 11,000 5.5 7,000 3.7 -3,608 - 33.7% -3,895 - 35.4% 105 +1.5%
13,607 1.1 8,592 4.6 12,000 6.0 8,424 4.4 -5,015 - 36.9% -3,408 - 28.4% 168 +2.0%
Reference figure (i):
Operating income not taking into account A
Reference figure (ii):
Income before taxes not taking into account A and B
3,131 ー -5,528 - 61.4% -3,028 - 46.6%
- 54.1%
Net income attributable to
Wacoal Holdings Corp.341 0.2 3,472 1.8 9,000 4.5 6,500 3.4
5.0 2,156 +97.9% -7,641 - 63.7% -5,141
-4,836 ー
Income before taxes 2,203 1.1 4,359 2.3 12,000 6.0 9,500
1,076 ー 1,810 ー -3,760 ー
+48.7% 63 +4.4%
B: Valuation gain (loss) on marketable
securities and investments – net-5,570 ー -3,760 ー ー
ー 1,424 ー -1,407 - 48.6% 487Other income (expenses) 2,894 ー 1,487 ー 1,000
1,753 +35.9% -4,368 - 39.7% -368 - 5.3%
ー
Operating Income 4,879 2.5 6,632 3.5 11,000 5.5 7,000 3.7
5,361 ー -473 ー -473
-2,104 - 2.2%
A: Impairment charges on goodwill and
other intangible assets-5,834 ー -473 ー
96,800 50.7 1,012 +1.1% -2,204 - 2.3%
- 5.7% -1,999 - 1.9%
S, G&A Expenses 93,684 48.2 94,696 50.7 96,900 48.5
54.0 103,800 54.3 -2,596 - 2.5% -6,099Sales profut 104,397 53.8 101,801 54.5 107,900
-4,845 - 5.4% -7,141 - 7.8% -2,241 - 2.6%
- 2.2%
Cost of Sales 89,804 46.2 84,959 45.5 92,100 46.1 87,200 45.7
-7,441 - 3.8% -13,240 - 6.6% -4,240
Compared to the
initial plan
Compared to the
revised plan
Consolidated net sales 194,201 186,760 200,000 191,000
FY2019
results
FY2020
results
FY2020
initial plan(Announced on
May 15, 2019)
FY2020
revised plan(Announced on
January 31, 2020)
Year on Year
13
Consolidated Financial Results Summary for FY2020
(Millions of yen)
ratio ratio ratio ratio Change % Change Change % Change Change % Change
Wacoal Business (Japan) 113,400 58.4 109,709 58.7 116,200 58.1 112,800 59.1 -3,691 - 3.3% -6,491 - 5.6% -3,091 - 2.7%
Wacoal Business (Overseas) 53,100 27.3 50,552 27.1 55,500 27.8 51,500 27.0 -2,548 - 4.8% -4,948 - 8.9% -948 - 1.8%
Peach John Business 10,491 5.4 10,480 5.6 11,600 5.8 10,400 5.4 -11 - 0.1% -1,120 - 9.7% 80 +0.8%
Other Businesses 17,210 8.9 16,019 8.6 16,700 8.4 16,300 8.5 -1,191 - 6.9% -681 - 4.1% -281 - 1.7%
194,201 100 186,760 100 200,000 100 191,000 100 -7,441 - 3.8% -13,240 - 6.6% -4,240 - 2.2%
% Of sales % Of sales % Of sales % Of sales Change % Change Change % Change Change % Change
Wacoal Business (Japan) 6,325 5.6 5,782 5.3 6,600 5.7 6,100 5.4 -543 - 8.6% -818 - 12.4% -318 - 5.2%
Wacoal Business (Overseas) 4,581 8.6 1,493 3.0 4,000 7.2 1,300 2.5 -3,088 - 67.4% -2,507 - 62.7% 193 +14.8%
Peach John Business -5,859 ー -351 ー 170 1.5 -270 ー 5,508 ― -521 ー -81 ー
Other Businesses -168 ー -292 ー 230 1.4 -130 ー -124 ― -522 ー -162 ー
4,879 2.5 6,632 3.6 11,000 5.5 7,000 3.7 1,753 +35.9% -4,368 - 39.7% -368 - 5.3%
Compared to the
revised plan
Operating income
Compared to the
initial plan
Compared to the
revised plan
Consolidated net sales
FY2019
results
FY2020
results
FY2020
initial plan(Announced on May 15, 2019)
FY2020
revised plan(Announced on January 31, 2020)
Year on YearCompared to the
initial plan
FY2019
results
FY2020
results
FY2020
initial plan(Announced on May 15, 2019)
FY2020
revised plan(Announced on January 31, 2020)
Year on Year
14
Consolidated Financial Results Summary by Operation Segment for FY2020
(Millions of yen)
15
Report by Operation Segment for FY2020 (1): Wacoal Business (Japan) *Overview of Wacoal is also explained on P37-39 of the reference.
Operating income ¥5.78 billion[Down ¥0.54 billion (-8.6%) year on year] [Reached 87.6% of the plan total and fell short of it by ¥0.81 billion) [Reached 94.8% of the revised estimate and fell short of it by ¥0.31 billion]
The proportion of fixed costs rose as the topline fell. The company started personnel planning and management to control expenses but is still halfway there.
Net sales ¥109.7 billion[Down ¥3.69 billion (-3.3%) year on year] [Reached 94.4% of the plan total and fell short of it by ¥6.49 billion] [Reached 97.3% of the revised estimate and fell short of it by ¥3.09 billion]
Wholesale…Installed 3D systems (6 stores) and completed customer data maintenance but challenges remain for its operation
Wholesale Business remained sluggish (CAGR of the last two years: -4%), and the growth of Retail and Web Businesses failed to make up for losses.
(Millions of yen)
Change % Change Change % Change Change % Change
Wholesale Bussines Div. 78,266 -4,080 - 5.0% -5,034 - 6.0% -2,930 - 3.6%
Retail end WEB
Business Dept.25,666 1,050 +4.3% -441 - 1.7% -399 - 1.5%
Others -4,708 -102 ー -628 ー 53 ー
99,224 -3,132 - 3.1% -6,103 - 5.8% -3,276 - 3.2%
10,485 -559 - 5.1% -388 - 3.6% 185 +1.8%
109,709 -3,691 - 3.3% -6,491 - 5.6% -3,091 - 2.7%
Wholesale Bussines Div. 13,646 -1,703 - 11.1% -1,804 - 11.7% -1,204 - 8.1%
Retail end WEB
Business Dept.2,075 78 +3.9% 105 +5.3% -140 - 6.3%
Others -12,581 -334 ー 539 ー 584 ー
3,140 -1,959 - 38.4% -1,160 - 27.0% -760 - 19.5%
2,642 1,416 +115.5% 342 +14.9% 442 +20.1%
5,782 -543 - 8.6% -818 - 12.4% -318 - 5.2%
Wacoal
Intersegment transactions,
etc. eliminetions
Operating income
■Decreased sales in the Wholesale Business caused the profit to drop
significantly.
■The plan was achieved for directly managed retail stores and the E-
commerce business combined.
■IT expenses related to omni-channel construction increased.
(*Wacoal’s labor expenses increased approx. \0.7 billion due to a review
of its retirement benefit expenses. In accordance with accounting policies,
approx. \0.5 billion of this amount has been reclassified as non-operating
expenses through consolidation adjustment.)
■The operating income of the Wacoal Business (Domestic) fell 9%.
Intersegment transactions,
etc. eliminetions
Net sales
■Prolonged sluggishness in sales of major wholesale channels (since Oct.)
■Challenges remain for recovery of products excluding underwear.
■Use of members’ data in marketing was optimized in directly managed
retail stores and the E-commerce business.
-As a result, Wacoal’s sales declined 3%.
■The sales of Ai fell due to the impact of unseasonable weather in the
summer.
■The sales of the Wacoal Business (Domestic) dropped 3%.
Compared to the
revised plan(Announced on January 31, 2020)
Full year comment
Wacoal
FY2020
results
Year on Year
Compared to the
initial plan(Announced on May 15, 2019)
Change % Change Change % Change Change % Change
19,194 708 +3.8% 444 +2.4% -412 - 2.1%
Wacoal Europe Ltd. 12,988 -1,118 - 7.9% -1,667 - 11.4% -661 - 4.8%
Wacoal China Co., Ltd. 11,081 -536 - 4.6% -1,426 - 11.4% -177 - 1.6%
7,289 -1,602 - 18.0% -2,299 - 24.0% 302 +4.3%
50,552 -2,548 - 4.8% -4,948 - 8.9% -948 - 1.8%
401 -1,694 - 80.9% -1,266 - 75.9% 275 +218.3%
Wacoal Europe Ltd. 1,007 -400 - 28.4% -182 - 15.3% -110 - 9.8%
Wacoal China Co., Ltd. 923 10 +1.1% 165 +21.8% 126 +15.8%
-838 -1,004 ー -1,224 ー -98 ー
1,493 -3,088 - 67.4% -2,507 - 62.7% 193 +14.8%
Intersegment transactions,
etc. eliminetions
Operating Income
■Operating loss of IO: \1.25 billion
■One-time expense related to the acquisition was \0.2 billion.
■Profit declined for existing businesses.
■Labor expenses increased.
■Expenses augmented due to advertising activities to increase brand recognition and the renewal of in-house EC website.
■Reduced rents and labor expenses due to the withdrawal from unprofitable stores contributed.
■Impairment charges on property, plant and equipment, and intangible assets were posted for Thai material companies.
■The operating income of the Wacoal Business (Overseas) decreased 67%.
Intersegment transactions,
etc. eliminetions
Net Sales
Wacoal International Corp.
(U.S.)
■Up 6% on a local currency basis in the U.S.
■Brand portfolio was expanded with the acquisition of “LIVELY.”
■Down 3% on a local currency basis in Europe
■U.K. business struggled due to slowdown in department store channels: Down 10%
■Up 1% on a local currency basis in China
■Promoted withdrawal from unprofitable department stores
■Down \1 billion for two material companies (the number of orders for core products declined) in Thailand
■Down \0.6 billion for Hong Kong Wacoal (due to sluggish sales caused by political instability and changes in transaction
conditions for Peach John)
Compared to the
revised plan(Announced on January 31, 2020)
Full year comment
Wacoal International Corp.
(U.S.)
FY2020
results
Year on Year
Compared to the
initial plan(Announced on May 15, 2019)
16
Report by Operation Segment for FY2020 (2): Wacoal Business (Overseas) *Overview of major corporations is explained on P40-43 of the reference.
Operating income ¥1.5 billion [Down ¥3.1 billion (-67%) year on year] [Reached 37% of the plan total and fell short of it by ¥2.5 billion) [Reached 115% of the revised estimate and exceeded it by ¥0.2 billion]
Absorption of operating loss of IO, one-time expense related to acquisition, poor performance of Thai material companies, and impairment charges on property, plant and equipment
Net sales ¥50.6 billion [Down ¥2.5 billion (-5%) year on year] [Reached 91.1% of the plan total and fell short of it by ¥4.9 billion] [Reached 98% of the revised estimate and fell short of it by ¥0.9 billion]
Department store channels (physical stores) were stagnant mainly in the U.S. and Europe while sales in EC channels, on which the company is focusing, grew in each country (the U.S.: +18%; Europe: +10%; China: +17%)
Strengthened EC in the U.S. and acquired IO (LIVELY) to reach out to young customers.
(Millions of yen)
Change % Change Change % Change Change % Change
10,480 -11 - 0.1% -1,120 - 9.7% 80 +0.8%
-351 5,508 ー -521 ー -81 ー
Lecien 5,760 -524 - 8.3% -768 - 11.8% -75 - 1.3%
Nanasai 8,717 -697 - 7.4% -83 - 0.9% -283 - 3.1%
Intersegment transactions,
etc. eliminetions1,541 29 +1.9% 169 +12.3% 76 +5.2%
16,019 -1,191 - 6.9% -681 - 4.1% -281 - 1.7%
Lecien -478 -103 ー -469 ー -10 ー
Nanasai 218 -64 - 22.7% -12 - 5.2% -37 - 14.5%
Intersegment transactions,
etc. eliminetions-32 43 ー -41 ー -115 ー
-292 -124 ー -522 ー -162 ー
■Suspension of publication of catalogs and withdrawal from unprofitable stores in Japan
■The business in Hong Kong struggled.■The business in China struggled.
■Impairment charges of \0.19 billion on trademark rights posted (balance of \0.49 billion)
■Sales in the material business dropped while OEM sales exceeded those in the previous
term.
■Sales decreased due to the recoil from large-scale construction projects in the previous
term.
■Sales of other segments fell 7%
■One-time expense accompanying the withdrawal of some businesses, including apparel,
was posted.
■Profit declined as sales fell.
■Operating loss was posted for other segments.
OtherNet Sales
Operating Income
Compared to the
revised plan(Announced on January 31, 2020)
Full year comment
Peach John
Business
Net Sales
Operating Income
FY2020
results
Year on Year
Compared to the
initial plan(Announced on May 15, 2019)
17
Report by Operation Segment for FY2020 (3): Peach John and Other Businesses *Overview of major corporations is explained on P44-45 of the reference.
Operating loss -¥0.4 billion [Up ¥5.5 billion year on year] [Fell short of the plan total by ¥0.5 billion] [Fell short of the revised estimate by ¥0.1 billion]
Peach John: Domestic sales improved by closing unprofitable stores and suspending publication of catalogs. Challenges remain for business in China.
Net sales¥10.5 billionAlmost the same as in the previous fiscal year [Reached 90% of the plan total and fell short of it by ¥1.1 billion][Reached 101% of the revised estimate and exceeded it by ¥0.1 billion]
Operating loss -¥0.3 billion [Down ¥0.1 billion year on year] [Fell short of the plan total by ¥0.5 billion) [Fell short of the revised estimate by ¥0.2 billion]
Other: Lecien to withdraw from unprofitable business
(product business (OEM orders, etc.) and material business (embroidery thread and lace) to be focused in future)
Net sales ¥16 billion [Down ¥1.2 billion (-7%) year on year] [Reached 96% of the plan total and fell short of it by ¥0.7 billion) [Reached 98% of the revised estimate and fell short of it by ¥0.3 billion]
(Millions of yen)
18
Basic Principles for Capital Policies (Disclosed on Jun. 13, 2019)
*If our business performance and demand for funds change
considerably due to COVID-19, we will reconsider the basic principles.
BasicPrinciples
Prioritize investments for future growth while striving to enhance shareholder returns
Achieve ROE of 6% exceeding capital costs
Maintain total return ratio of 100%
Reduce strategically-held shares (target: 30% reduction)
19
1. Net income in real terms: Down ¥3.1 billionThe “earning capacity” as an enterprise declined.
It is indispensable to regain the “earning capacity.”
Overview of the Financial Measures and Related Issues for FY3/2020
FY3/19 Shareholders’ equity
¥216.5 billion
Creation of cash in FY3/20 Total: ¥27.8 billion
Net income for FY3/20* ¥6.5 billion
Sale of strategically-
held shares for FY3/20
¥15.3billion
Investment in existing businesses
Investment for growth
¥16.2billion
Depreciationfor FY3/20 ¥6 billion
DividendsPurchase of treasury stocks
¥12.6billion
ROE: 0.2%(4.2% in real terms)
FY3/20 Shareholders’ equity
¥205.4 billion
ROE: 1.6%(3.0% in real terms)*Net income was calculated without considering the impairment
charges on intangible assets and valuation gain (loss) on marketable securities and investments.
Consolidated ROE: 1.6% (+1.4pt)
In real terms, excluding impairment charges and valuation loss: 3.0% (-1.2pt)
Major figures in FY3/20
FY3/20cash used:
¥28.8 billion
Consolidated operating income ratio: 3.6% (+1.1pt)
In real terms, excluding impairment charges: 3.8% (-1.7pt)
2. At present, we need to put importance on the stability of our financial base.Assuming the lingering pandemic, we will take “defensive” measures for a whole. To raise credit lines of financial institutions, postpone new investments, andreduce remunerations.The entire Wacoal group will put more energy into “selection and concentration of businesses.”
We invested for strengthening e-commerce in the U.S. Total return ratio remained over 100%.
(Billions of yen) (Billions of yen)
FY2020
4QFY2020
Medium-Term
Management Plan Period
(FY2020-FY2022)
results results plan detail amount
Net income attributable to
Wacoal Holdings Corp.★ -2.2 6.5 31.0 or more The acquisition of IO 9.2
depreciation costs 1.6 6.0 19.0 or moreIT-related investment ,etc
(wacoal)3.2
Sales of strategically-held shares 5.0 15.3 20.0 or moreInterior finish work for directly
retail stores, etc(wacoal)0.6
total 4.4 27.8 70.0 or moreBuilding renovation, etc
(wacoal)0.5
★Net income was calculated without consideration for valuation gain (loss) on marketable securities and investments. Domestic Subsidiaries 0.5Growth investment,
Capital expenditures 1.9 16.2 Overseas Subsidiaries 2.2
Dividend payment 0.0 4.9
Purchase of treasury stock 2.7 7.7
(Number of shares acquired) (969 thousand shares) (2,797 thousand shares)
total 4.6 28.8
■Major KPI
Sale amount 4.4 13.6
Progress toward target 22% 68%Number of strategic stocks sold
completely 0.2 1.2 total 16.2
Major investments and investment
amount in the FY2020
Cash
generation
Used Cash
Status of sales of
strategically-held
shares
(Wacoal Corp.)
20.0
68.5 or more
・Dividend/Reasury stock:
\31billion or more
・Investmen in existing business t/Growth
investment: \21billion or more
・Additional returns or investment in new
business: \16.5billion or more
Capital Policies and Shareholder Returns
20
Selling strategically-held shares: ¥13.6 billion (progress rate: 68%) *Book value as of the end of Mar. 2019 *Actual selling amount: ¥15.3 billion
21
Regarding the Year-End Dividend for the Current Term
Unfortunately, the year-end dividend was revised to 20 yen/share (including the special dividend of 4 yen/share).
The latest dividend forecast: 40 yen/share → 20 yen/share
Combined with the interim dividend of 40 yen/share, the annual total is 60 yen/share.
As it is impossible to predict when the pandemic will end, we prioritize liquidity on hand.
The dividend in the next term is still to be determined.
(It will be announced as soon as the disclosure of a reasonable earnings forecast becomes possible.)
FY3/2019 36yen 36yen 72yen 4,732 49.1%
FY3/2020 (initial estimate) 40yen 40yen 80yen ー ー
FY3/2020 (revised) 40yen 20yen 60yen 3,808 58.6%
Revised amount ±0 -20yen -20yen
Change from the previous year +4yen -16yen -12yen
*Payout ratio was calculated from net income in real terms without considering the impairment charges on intangible assets and valuation
gain (loss) on marketable securities and investments.
Dividend per share Total amount of
dividends
(Millions of yen)
Payout
ratio*Interim Year-End Annual
22
Regarding Disclosure in the Future
[Disclosure policies in the Future]
The consolidated full year business performance forecast for FY3/21 will be announced as soon as the details become clear.
If there is any event that would entail a significant impact, we will disclose it immediately.
The online sessions for briefing the results for 1Q and 3Q will be held.
(The sessions are, in principle, scheduled to be held in the evening of the date of announcement of financial results.)
As for monthly information, we will report not only figures, but also our business information briefly.
(The updating date is around the 15th day of each month in Japan, and around the 25th day of each month outside Japan.)
Executives will work on IR activities proactively, to deepen engagement with investors.
If there is any event that would entail significant changes, we will disclose it immediately. The employees of our group companies around the world will share a “sense of crisis” and a “passion for the future” to overcome the unprecedented crisis. We would appreciate your continued support.
23
For a Fresh Start of Wacoal Group
Hironobu Yasuhara
Wacoal Holdings Corp.
Representative Director, President and Corporate Officer
24
Impact of COVID-19 on Our Business (1)
1. The impact on our business administration is extremely high. As a state of emergency was declared around the world, economic activities are significantly stagnant around the world.
Due to the suspension of business operations of our stores, restrictions on outings, etc. for preventing the spread of novel
coronavirus, our group’s business activities suffered significant adverse effects globally. In addition, the downturn of
consumer spending, etc. caused by the deterioration of the employment and income environments is estimated to keep
producing adverse effects on our sales and profit.
2. Business conditions in each country
The EC channel grew, but sales nosedived in each country, due to the temporary closure of physical stores.
In-house EC sales in April: +76% for Wacoal; +77% for Peach John; +33% for Wacoal America, Inc.
(*The EC sales ratio of each major company in FY2020 is written on p.46.)
Net sales EC sales only Net sales EC sales only
Wacoal (Japan)●After the state-of-emergency declaration (April 7), all department stores and directly managed
stores are closed (only some mass retail stores are open).
●Business restarts in some areas after May 11
-29% Own EC site +21% -72% Own EC site+76%
Peach John(Japan)●After the state-of-emergency declaration (April 7), all directly managed stores are closed
●Business restarts in some areas after May 11-14% Own EC site -13% -19% Own EC site+77%
Wacoal America, Inc.* ●All stores are closed as of the end of April -11%EC+14%
(EC sales including own
and other company)
-68% Own EC site+33%
Wacoal Europe Ltd. ●Closed in almost all areas as of the end of April
(Some stores in Australia are open)-40%
Third party EC sites
-22%-74%
Third party EC sites
±0%
Wacoal China Co., Ltd.
●After the city blockade on January 23, it resumed operations by the end of March
(There are the limitation of business hours and a ban on activities for attracting customers).
●As of April 20, all stores have resumed business (excluding the two stores scheduled to be
renovated).
★ The figures for Wacoal America only are disclosed. It is not the figures of sales of Wacoal International including Intemate Online inc.(LIVELY).(Wacoal International Corp. (U.S.) sales including Intemate Online inc.: -47%)
Business situationMar. Apr.(Preliminary Report)
See P.25 for sales information
Jan. Feb. Mar. 1Q Apr.(Preliminary Report)
Net sales Net sales Net sales Net sales Net sales
In stores +1% -94% -66% -51% -32%
Third party EC sites -6% +29% +19% +15% -56%*
Other -32% -69% -52% -50% ー
-4% -81% -48% -42% -37%
*EC sales in Wacoal China in April 2019 increased significantly (+ 182%) due to promotion measures by EC mall operators.Sales fell in April 2020 due to the reaction.
Wacoal China Co., Ltd.
Total
25
Impact of COVID-19 on Our Business (2)
3. Recovery situation in China
In the case in China, it took several months to recover from the pandemic, but the degree of recovery is resumed to about 70%.
For the period from Sep. to Dec. in Japan, it is necessary to take into account the impact of the consumption tax hike in the previous term (the rush demand and the recoil from it).
Each city was locked down on Jan. 23, and in mid-Feb., only about 30% (100 stores) were in operation, and
the vacation of the Chinese New Year was extended. As a result, sales declined by 80%.
In March, the operation of some stores was resumed, but due to the limitation of business hours and a ban
on activities for attracting customers, customer traffic was sluggish, and sales declined by 50%.
In April, all shops were reopened, and sales at stores resumed to about 70%.
26
Impact of COVID-19 on Our Business (3)
4. The distribution channel, consumer value, and buying behavior changed rapidly.
It is essential to discern “irreversible changes” and “temporary effects.” A hypothesis is formulated, but a hasty judgment is risky.
5. A sense of crisis has emerged within the Wacoal Group.
Will the strengths and values we have cultivated so far be used in new lifestyles?
・ “Whether our close customer relations will be accepted”
・ “Whether we will be able to provide customers with products and services they want in new lifestyles in the future”
・ “Whether conventional business models can tolerate the reform of the sales channel”
■Business environment as of the release of the Medium-Term Management Plan in Jun. 2019 (change and trend of consumption behavior)
■Trend of the distribution channel
・Downturn of department stores/ GMS and supermarkets・Rapid growth of EC and global SPAs
■Change of consumers
・Increase of women flourishing in society ・Outfits becoming casual ・Money-saving trend
■Technological innovation
・Acceleration of digitization for consumption・Society where residents are directly connected to one another
■Trends in the industry and the industrial structure
・It’s difficult to secure sales staff・Decrease of high-quality manufacturers
Decline of existing distribution channels, and acceleration of shift to EC. How the roles of stores will change is still unknown.
Telecommuting became one of workstyles. Outfits became casual. On the other hand, there remains the money-saving trend.
Enterprises that cannot carry out digital transformation will not survive. Customer-oriented reform for the digitized society is important.
・Downturn of the middle/high-class apparel market, and acceleration of the survival of the fittest in the industry・New country risk (materials)
Present
1 year ago
27
Our Policy for Coping with the Spread of COVID-19
[Basic policy]
Give top priority to the “health and safety” of customers, employees, and business partners.
(*We recognize that the balance between maintaining such services as trial fitting and consideration of health and safety is especially important.)
[Short-term policy]
Thoroughly reduce costs and ensure the stability of the Company's financial base with the
deteriorating business conditions in mind
[Medium- to long-term policies]
Thoroughly inspect the value chain and implement reforms: A turning point toward a highly
profitable management structure
1. Carry out a bold review of the measures and expenditure plans that have been implemented so far across all business domains
2. Strengthen liquidity on hand in preparation for the prolongation of the infectious disease
3. Adjust production for avoiding excess inventory caused by a decline in sales
1. Review the current cost structure (Promote initiatives to reduce fixed costs)
2. Accelerate our digital transformation efforts both in Japan and overseas
3. Review and reorganize touch points with customers (to respond to the changes in major channels)
4. Develop products and services that customers expect in new lifestyles, and strengthen our ability to respond to new customer needs and sales styles
28
[Short-term policy]
1. Carry out a bold review of the measures and expenditure plans that have been implemented so far across all business domains
Thoroughly Reduce Costs and Ensure the Stability of the Company's Financial Base with the Rapidly Deteriorating Business
Conditions in Mind
2. Strengthen liquidity on hand in preparation for the prolongation of the infectious disease
Reduce advertising costs, etc. through the review of marketing activities
Cancel events, such as exhibitions, promote an in-depth work style reform, and reduce expenses for business
trips, etc.
Reduction in executive remuneration (Monthly remunerations: Down 30% for the chairperson and the
president; down 20% for other directors and auditors)
Review the timing of new investments
Expand the borrowing facilities from financial institutions for securing liquidity on hand for each group company
Reexamine our future cash level based on the lessons learned from this situation
FY2016 FY2017 FY2018 FY2019 FY2020
Cash and cash equivalents 34,059 33,995 29,487 30,133 27,905
Time deposits 2,131 2,722 4,296 4,004 797
Marketable securities 1,880 1,457 1,567 446 656 examaine
38,070 38,174 35,350 34,583 29,358
2.25 2.34 2.17 2.14 1.89
Liquidity on handNew KPI
Ratio of liquidity on hand
Thoroughly Reduce Costs and Ensure the Stability of the Company's Financial Base with the Rapidly Deteriorating Business
Conditions in Mind
29
3. Adjust production for avoiding excess inventory caused by a decline in sales(Tightening of management of working capital)
Due to the sluggish sales caused by COVID-19, stocks became excessive temporarily, we plan to reduce inventory levels to the
level at the end of the previous fiscal year by adjusting the production of Autumn/Winter products and the next Spring/Summer
products (*In the Wacoal Business (Domestic), we have ordered a 20% decrease in production output.)
The inventory amount has been decreasing in the past few years, but inventory turnover became the longest in history, due to
the decline in the top line. (*During the reconsideration of mid/long-term strategies, the ideal inventory level (KPI) and
achievement processes were discussed.)
Inventories ¥44.4billion
¥43.8billion
¥42.7billion
¥42.5billion
¥43.4billion
NewKPI
Inventory turnover 165
days
NewKPI
End of FY2016
End of FY2017
End of FY2018
End of FY2019
End of FY2020 During
FY2021
Ideal stateEnd of
FY2021(estimate)
170days
170days
170days
180days
Worsening
Expecting the inventory level as of the end of the
previous term
[Short-term policy]
30
1. Review the current cost structure (Promote initiatives to reduce fixed costs)
Check and review business models while considering ideal fixed costs in each company (lowering of the break-even point ratio)
Estimate future demand in all businesses, and conduct “business selection and concentration” further
Make it clear “what we stop,” “what we start for the future,” and “for what we revise the course while we continue it.”
Implement further staffing plan management
Set the ideal state (KPI) of the cost structure and discuss achievement processes
47.4%Cost 46.2% 45.5% New KPI
Labor expenses
20.5%
26.1%
5.5%
Generalexpenses
Operatingincome
22.3% 22.9% New KPI
25.9% 27.4%
6.0% 4.2%
New KPI
7% to 10%
FY2016 FY2019* FY2020* Ideal state
-1.2pt -0.7pt
+1.8pt +0.6pt
-0.2pt +1.5pt
-0.5pt -0.3pt
*Calculated after removing impairment charges on intangible assets
[Medium- to long-term policies]
Thoroughly Inspect the Value Chain and Implement Reforms:
A Turning Point Toward a Highly Profitable Management Structure
31
2. Accelerate our digital transformation (DX) efforts both in Japan and overseas
(Utilization of the customer database, cementing of cooperation between stores and EC, and
improvement in customer experience (CX))
[Japan]
Keep enhancing omni-channel strategies for constructing “deep, broad, and long” relationships with customers (To discern
changes in purchase behavior and correct courses if necessary)
Check all business thoroughly for offering customer experience-oriented services and value
Promote the collaboration and fusion (mutual introduction of customers) between physical stores and e-commerce
Establish efficient operation methods for customer databases in all businesses (to reel in active customers in a strategic manner)
Revise the course of operation of customer service systems using 3D systems and Artificial Intelligence to respond to new lifestyles
[Overseas]
Keep improving the EC business. Check each business thoroughly, under the “customer-experience-based ideas” like in Japan
For Asian corporations for which the shift to EC has not progressed other than the companies in the U.S., China, and Europe, we will establish
a platform at an accelerated pace.
(*Since the shift to EC had not progressed at all, they suffered significant damage from the pandemic.)
Acceleration of growth of the EC business according to the circumstances of each region.
-Acceleration of growth of LIVELY -Cooperation with e-commerce operators in China, etc.
[Medium- to long-term policies]
Thoroughly Inspect the Value Chain and Implement Reforms:
A Turning Point Toward a Highly Profitable Management Structure
32
3. Review and reorganize touch points with customers
(to respond to the changes in major channels)
-Check and review management systems for revenue-focused store operation
[Japan]
Consider responses in anticipation of a business model conversion of department stores (switch to Self-Operated (Building Lease) business)
The goal is revenue-focused store operation. It is essential to realize efficient staffing and management of store profits and losses.
Discuss the balance among the businesses of wholesale, self-operation (building lease), directly managed stores, and in-house EC
<Set the ideal state (KPI) and discuss achievement processes >
[Overseas]
Improve EC (covering the negative factors of off-line business with improved EC), and promote the cultivation of countries or regions where
business scale is small
Physical stores in not only the U.S. and the U.K., but also other regions will fall into dire straits.
<Set the ideal state (KPI) and discuss processes for achieving it>
4. Develop products and services that customers expect in new lifestyles, and strengthen our
ability to respond to new customer needs and sales styles
Review the brand portfolios and reconfigure our product mix according to the new values
Discuss new customer service methods and conduct test marketing (such as live commerce and chat consulting)
Carefully watch where the value judgment of “beauty” of women around the world goes, and determine the direction
[Medium- to long-term policies]
Thoroughly Inspect the Value Chain and Implement Reforms:
A Turning Point Toward a Highly Profitable Management Structure
33
Schedule (Provisional)
In the spring of 2021, we plan to hold a session for explaining concrete measures for our
mid/long-term policy against COVID-19 and the vision for the final year of the Medium-
Term Management Plan.
Activities in 2020
1Carry out a bold review of the measures and expenditure plans that
have been implemented so far
2Strengthen liquidity on hand in preparation for the prolongation of
the infectious disease
3 Adjust production for avoiding excess inventory caused by a decline
in sales
1Review the current cost structure (Promote initiatives to reduce
fixed costs)
2Accelerate our digital transformation (DX) efforts both in Japan and
overseas
3 Review and reorganize touch points with customers
4
Develop products and services that customers expect in new
lifestyles, and strengthen our ability to respond to new customer
needs and sales styles
Session for announcing and briefing the results for FY2021 1Q
Disclosure of the full-year earnings forecast for FY2021
*We will hold an online briefing session.
30 October 2020 Session for announcing the results for FY2021 2Q
4 November 2020 Session for briefing the results for FY2021 2Q
Session for announcing and briefing the results for FY2021 3Q
*We will hold an online briefing session. 29 January 2021
Schedule from now on
Medium- to long-
term policies
Basic policy
● Cost reduction is underway.
●Production adjustment will start with products to be sold in the
fall/winter season.
●Share the awareness of the environment.
●Discern the future after changes carefully, and set a hypothesis
to solve problems.
●Predict demand in a calm manner, and determine “what we
continue” and “what we stop.”
●Test the hypothesis regarding the change in customers’ value.
●Determine our ideal state, KPI, and achievement processes.
Short-term policy
31 July 2020
34
Lastly
Evolve into a company that is even more needed and trusted by society
“Lighting up for encouragement,” which illuminates Wacoal Shin-Kyoto Bldg. (Hachijo Exit of Kyoto Station) (From May 1)
35
Reference
FY2020
initial plan
FY2020
revised palnChange
%
ChangeChange
%
ChangeChange
%
Change
FY2020
initial plan
FY2020
revised palnChange
%
ChangeChange
%
ChangeChange
%
Change
Wacoal 102,356 99,224 105,327 102,500 -3,132 - 3.1% -6,103 - 5.8% -3,276 - 3.2% 5,099 3,140 4,300 3,900 -1,959 - 38.4% -1,160 - 27.0% -760 - 19.5%
Ai 4,181 3,597 4,290 3,750 -584 - 14.0% -693 - 16.2% -153 - 4.1% -321 -269 53 -141 52 ー -322 ー -128 ー
Wacoal
International
Corp. (U.S.)
18,486 19,194 18,750 19,606 708 +3.8% 444 +2.4% -412 - 2.1% 2,095 401 1,667 126 -1,694 - 80.9% -1,266 - 75.9% 275 +218.3%
Wacoal Europe
Ltd.14,106 12,988 14,655 13,649 -1,118 - 7.9% -1,667 - 11.4% -661 - 4.8% 1,407 1,007 1,189 1,117 -400 - 28.4% -182 - 15.3% -110 - 9.8%
Wacoal China
Co., Ltd.11,617 11,081 12,507 11,258 -536 - 4.6% -1,426 - 11.4% -177 - 1.6% 913 923 758 797 10 +1.1% 165 +21.8% 126 +15.8%
Peach John
BusinessPeach John 10,491 10,480 11,600 10,400 -11 - 0.1% -1,120 - 9.7% 80 +0.8% -220 -160 170 -270 60 ー -330 ー 110 ー
Lecien 6,284 5,760 6,528 5,835 -524 - 8.3% -768 - 11.8% -75 - 1.3% -375 -478 -9 -468 -103 ー -469 ー -10 ー
Nanasai 9,414 8,717 8,800 9,000 -697 - 7.4% -83 - 0.9% -283 - 3.1% 282 218 230 255 -64 - 22.7% -12 - 5.2% -37 - 14.5%
Wacoal
International
Corp. (U.S.)
166,679 176,508 170,465 180,421 9,829 +5.9% 6,043 +3.5% -3,913 - 2.2% 18,900 3,694 15,150 1,167 -15,206 - 80.5% -11,456 - 75.6% 2,527 +216.5% (USD'000)
Wacoal Europe
Ltd.96,826 93,954 101,062 99,509 -2,872 - 3.0% -7,108 - 7.0% -5,555 - 5.6% 9,663 7,290 8,198 8,105 -2,373 - 24.6% -908 - 11.1% -815 - 10.1% (GBP'000)
Wacoal China
Co., Ltd.694,776 702,223 758,000 708,066 7,447 +1.1% -55,777 - 7.4% -5,843 - 0.8% 54,594 58,468 45,900 50,114 3,874 +7.1% 12,568 +27.4% 8,354 +16.7% (CNY'000)
Year on Year
Wacoal
Business
(Japan)
Wacoal
Business
(Overseas)
Other
Businesses
Compared to the
revised plan
Major Overseas Subsidiaries( (Local Currency Basis )
Operating Income
FY2019
results
FY2020
results
Year on YearCompared to the
initial planFY2019
results
FY2020
results
Compared to the
revised plan
Compared to the
initial plan
Net Sales
FY2020 target FY2020 target
36
(Millions of yen)
Financial Results by Major Corporations for FY2020
(Millions of yen)
Change % Change Change % Change Change % Change
Wholesale Business Div. 78,266 -4,080 - 5.0% -5,034 - 6.0% -2,930 - 3.6%
Retail end WEB Business Department 25,666 1,050 +4.3% -441 - 1.7% -399 - 1.5%
Others -2,985 -13 +0.4% -78 +2.7% -24 +0.8%
100,946 -3,043 - 2.9% -5,554 - 5.2% -3,354 - 3.2%
99,224 -3,132 - 3.1% -6,103 - 5.8% -3,276 - 3.2%
Wholesale Business Div. 13,646 -1,703 - 11.1% -1,804 - 11.7% -1,204 - 8.1%
Retail end WEB Business Department 2,075 78 +3.9% 105 +5.3% -140 - 6.3%
Others(Intersegment transactions,etc.) -12,481 -234 +1.9% 1,619 - 11.5% 684 - 5.2%
3,140 -1,959 - 38.4% -180 - 5.4% -760 - 19.5%
Compared to the
revised plan
Net sales total(Including internal sales)
Net sales total(External customers only)
Wacoal Operating income
FY2020
results
Year on YearCompared to the
initial plan
37
Overview of Wacoal for FY2020 (1) <Net Sales and Operating Income of Major Business Segments>
Operating income ¥3.1 billion [Down ¥2 billion (-38%) year on year] [Reached 73% of the plan total and fell short of it by ¥1.2 billion) [Reached 80% of the revised estimate and fell short of it by ¥0.8 billion]
Gross profit rate continued to improve (Wholesale Business and Retail Business improved 0.1 points and 0.4 points, respectively)
SG&A ratio rose to 53% as labor expenses grew due to a review in retirement benefit expenses. (*before consolidation adjustment) (up 2.5 points from the previous term)(*SG&A ratio is calculated against sales, including internal sales.)
Net sales ¥99.2 billion [Down ¥3.1 billion (-3%) year on year] [Reached 94% of the plan total and fell short of it by ¥6.1 billion) [Reached 97% of the revised estimate and fell short of it by ¥3.3 billion]
Sales remained sluggish in the Wholesale Business (FY2019: -¥2.7 billion from the previous term; FY2020: -¥4.1 billion from the previous term) CAGR over the last two years: -4%
Sales were steady in the Retail and Web Businesses (FY2019: +¥0.2 billion from the previous term; FY2020: +¥1 billion from the previous term) CAGR over the last two years+2.5%
Sales increased in the Retail and Web Businesses that actively utilized customer data. Challenges remain for the Wholesale Business regarding 3D and customer data utilization
(Millions of yen)
Change % Change Change % Change
Wacoal -4% +11% -15% -18% 37,930 -2,334 -6% -2,731 -7%
Wing +11% +8% -3% -7% 20,414 450 +2.3% 14 +0.1%
Wacoal -10% +6% -18% -25% 4,739 -622 -12% -491 -9%
Wing -38% -10% -26% +18% 562 -104 -16% 292 +108.3%
Wacoal -17% -6% -26% +21% 2,811 -595 -17% -354 -11%
Good Age Business Wacoal -2% -8% -10% -56% ー ー ー ー ー
Hosiery Business Wacoal -3% -2% -27% -23% ー ー ー ー ー
Men's inner Business Wacoal -9% +2% -13% -10% ー ー ー ー ー
Above 3 businesses total ー ー ー ー 4,254 -341 -7% -865 -17%
CW-X、Wacoal -8% +3% -25% -27% 4,610 -801 -15% -1,160 -20%
ー ー ー ー 2,946 267 +10.0% 262 +9.7%
-2% +8% -13% -15% 78,266 -4,080 -5% -5,034 -6%
Wellness Business
Others
Wholesale Business Div. total
Sales of each business in Wholesale Business Division of Wacoal Corp.
Year on Year Compared with Target
Innerwear Business
Personal Business
Family wear Business
1Q 2Q 3Q 4QFY2020
results
38
Overview of Wacoal for FY2020 (2) <Wholesale Business>
Business, mainly in department stores, was stagnant in general (sales decreased by double digits for almost all products except underwear).
Wing’s underwear products, mainly sold at GMS and supermarkets, achieved the estimate thanks to the aggressive promotional measures.
Department store -6% +8% -14% -23% -9%
GMS,Supermarket (Wacoal Brand) -4% +15% -18% -16% -5%
GMS,Supermarket (Wing Brand) +4% +19% -5% -11% +0%
Specialty Stores +4% +6% -6% -11% -2%
Sports Chains -11% +11% -22% -28% -12%
Third Party EC Sites -7% +5% -8% -3% -3%
Directly Managed Stores +6% +6% +0% -2% +3%
Wacoal’s Own EC Site +18% +24% +11% +17% +17%
Catalog mail-order +10% +6% -13% -13% -4%
Retail
Wholesale
Quarterly change in sales at stores by sales channel of Wacoal Corp.
1Q 2Q total3Q 4Q
Overview of Wacoal for FY2020 (3) <Change in Sales at Stores (Increase/Decrease)>
39
Prolonged slump in demand after the consumption tax hike and a decline in the number of customers due to a voluntary restraint on going out since March
In the Retail Business (directly managed retail stores), reinforcement of measures for products and marketing for member customers was successful.
Sales of the in-house EC kept growing by double digits throughout the year.
◆Quarterly change in sales in major channels and regions (in local currency) Performance of major subsidiaries (USD'000)
Department store -12% -9% -4% -6% -8% Net sales 168,685 11,967
Outlet・Directly Managed Store -23% -30% -11% -22% -23% (Year on Year) -1% ー
Store sales total -12% -10% -4% -6% -8%Operating
profit and loss14,830 -11,494
Department store EC site -2% +19% +62% +9% +16% (Year on Year) -22% ー
Third Party EC site -2% +5% +25% +19% +9% *IO sales are calculated based on sales from August to March.
Wacoal’s Own EC Site +17% +33% +24% +35% +27%
EC sales total +4% +19% +36% +22% +18%
America -7% -2% +7% +3% -1% 92%
Canada +2% -5% +2% +0% -1% 4%
Other area +1% -16% +6% -47% -17% 4%
Area
ratio★ Wacoal America,
Inc.IO
Channel
Store 62%
EC 34%
1Q 2Q 3Q 4Q total
40
Overview of Wacoal International Corp. (The U.S.) for FY2020
Operating income ¥0.4 billion[Down ¥1.7 billion (-81%) year on year] [Reached 24% of the plan total and fell short of it by ¥1.3 billion] [Reached 318% of the revised estimate and exceeded it by ¥0.3 billion]
IO: ¥0.55 billion smaller than the estimate (an operating loss of ¥0.7 billion) (due to declined sales, increased SG&A expenses and the posting of depreciation)
Net sales¥19.2 billion[Up ¥0.7 billion (4%) year on year] [Reached 102% of the plan total and exceeded it by ¥0.4 billion] [Reached 98% of the revised estimate and fell short of it by ¥0.4 billion]
Wacoal America: Physical stores: -8%; EC: +18% (Department store EC sites: +16%; Third party EC sites: +9%; Wacoal’s own EC site: +27%) EC ratio: 34% (up +5.4pt)
IO: Net sales were ¥0.3 billion smaller than the estimate (¥ 1.6 billion) resulting from the dropped effectiveness of attracting customers due to a change in
advertisement operation methods for the main social networking sites and the posting of provisions with the unification of accounting standards.
(*Reference: +31% from the previous term of IO between Aug. and Sep.)
Promoted initiatives to create growth opportunities and strengthen competitiveness in EC, and acquired IO “LIVELY”
(*Reference) Local-currency base: [Up 6% year on year] [Reached 104% of the plan total]
(*Reference) Local-currency base: [Down 80.5% year on year] [Reached 24.4% of the plan total]
◆(Europe) Quarterly change in sales in major channels and brands (in local currency)
Department store -27% +7% +0% -14% -10% 21%
Specialty store -5% +10% +2% -19% -4% 52%
Directly Managed Store -15% -6% -1% -3% -7% 6%
EC sites Third party EC site/other +19% +29% +4% -9% +10% 21%
Fantasie -5% +20% -2% -17% -2% 34%
Freya -17% +1% -8% -18% -11% 24%
Goddess -13% +3% -2% -1% -4% 5%
Elomi +6% +15% +16% -7% +7% 24%
Wacoal -8% +8% +10% -24% -4% 12%
B.Tempted -16% -17% -17% -29% -19% 1%
ratio
Channelstore
Brand
1Q 2Q 3Q 4Q total
41
Overview of Wacoal Europe for FY2020
Operating income ¥1 billion [Down ¥0.4 billion (-28%) year on year] [Reached 85% of the plan total and fell short of it by ¥0.2 billion] [Reached 90% of the revised estimate and fell short of it by ¥0.1 billion]
Gross profit rate decreased 0.4 points(improved through 3Q, but worsened in 4Q).
Expenses increased due to enhancement of advertising activities to increase brand recognition and the posting of expenses for the renewal of the in-house EC site.
Net sales ¥13 billion[Down ¥1.1 billion (-8%) year on year] [Reached 89% of the plan total and fell short of it by ¥1.7 billion] [Reached 95% of the revised estimate and fell short of it by ¥0.7 billion]
By region, the U.K struggled due to poor performance of the core department stores (The U.K.: -10%; Europe: -1%; North America: +3%)
Third party EC sites: +10% (Third party EC sites ratio: 21%, up 3pt)
*Full-scale operation started in the second half with the completion of the renewal of the in-house EC site.
The U.K. business struggled, but sales grew until 3Q as business in North America and Europe was steady. Sales fell in 4Q with the spread of the infection.
(*Reference) Local-currency base: [Down 3% year on year] [Reached 93% of the plan total]
(*Reference) Local-currency base: [Down 25% year on year] [Reached 89% of the plan total]
◆(China) Quarterly change in sales in major channels and brands (in local currency)
Department store +2% -3% -4% +1% -1% 75%
Third party EC site +22% +26% +17% +7% +17% 25%
Wacoal +6% +11% +1% 5% +6% 84%
Salute -11% -16% -15% -7% -13% 8%
LA ROSABELLE -42% -19% -74% -92% -57% 1%
Peach John +3% -38% -28% -28% -25% 7%
ratio
Channel
Brand
1Q 2Q 3Q 4Q total
42
Overview of Wacoal China for FY2020
Operating income¥0.9 billion[Up 1% year on year] [Reached 122% of the plan total and exceeded it by ¥0.2 billion] [Reached 116% of the revised estimate and exceeded it by ¥0.1 billion]
Gross profit rate was improved by reducing the sales composition ratio of the brand with low profitability (Peach John).
Labor expenses and rent declined as a result of withdrawing from unprofitable stores.
Net sales ¥11.1 billion[Down ¥0.5 billion (-5%) year on year] [Reached 89% of the plan total and fell short of it by ¥1.4 billion] [Reached 98% of the revised estimate and fell short of it by ¥0.2 billion]
EC sales excluding Peach John: +35% EC sales ratio: 20% (+5pt)
Started the sale of the Japanese brand “AMPHI” to acquire a new customer base.
Maintained high growth of EC by strengthening ties with e-commerce operators
(*Reference) Local-currency base: [Up 1.1% year on year] [Reached 92.6% of the plan total]
(*Reference) Local-currency base: [Up 7% year on year] [Reached 127% of the plan total]
43
Overview of Other Asian Regions for FY2020
Overview of Wacoal India for FY2020
Net sales ¥2.4billion (Down ¥1 billion year on year; fell short of the plan total by ¥1.1 billion)
Operating loss -¥0.4 billion (Almost the same as previous year; fell short of the plan total by ¥0.3 billion)
Figures including the sales of Hong Kong Wacoal, Wacoal International Hong Kong, Wacoal Singapore, Philippine Wacoal, Wacoal India, (Factories) Dalian Wacoal, Guangdong Wacoal, Vietnam Wacoal, Myanmar Wacoal, A-Tech, G-Tech and 1 other company, and settlement adjustment of Wacoal Business (Overseas)
Overview of Two Material Companies in Thailand (A-Tech and G-Tech) for FY2020
Operating loss -¥0.8 billion[Down ¥1 billion year on year] [Fell short of the plan total by ¥1.2 billion] [Fell short of the revised estimate by ¥0.1 billion]
Impairment charges on property, plant and equipment at Thai material companies posted: Approx. ¥1.1 billion
Net sales ¥7.3 billion[Down ¥1.6 billion (-18%) year on year] [Reached 76% of the plan total and fell short of it by ¥2.3 billion] [Reached 96% of the revised estimate and fell short of it by ¥0.3 billion]
Hong Kong Wacoal: -¥0.6 billion: Stagnant sales due to political instability and changes in transaction conditions for Peach John Hong Kong affected sales.(Over-the-counter sales of Peach John in the Hong Kong region are now posted to the Peach John business segment.)
Thai material companies: -¥1 billion: Their performance was affected by the decrease of orders for their main products due to the excessive stocks of clients and the delay in new product development.
Posted impairment charges due to sluggish sales at Thai material companies caused by the decrease of orders for core products (warp knitting and circular knitting materials)
Net sales ¥0.21 billion (Up ¥0.09 billion year on year; fell short of the plan total by ¥0.02 billion)
Operating loss -¥0.13 billion (Down ¥0.05 billion year on year; fell short of the plan total by ¥0.01 billion)
44
Overview of 4 Domestic Subsidiaries for FY2020 (PJ and Ai)
Operating loss-¥0.3 billion [Up ¥0.05 billion year on year] [Fell short of the plan total by ¥0.3 billion] [Fell short of the revised estimate by ¥0.1 billion]
Net sales ¥3.6 billion[Down ¥0.6 billion (-14%) year on year] [Reached 84% of the plan total and fell short of it by ¥0.7 billion] [Reached 96% of the revised estimate and fell short of it by ¥0.2 billion]
Ai: Sales were sluggish in July due to bad weather, but grew almost as planned in other months. The swimwear business
was transformed into the resort wear business.
Operating loss -¥0.4 billion[Up ¥5.5 billion year on year] [Fell short of the plan total by ¥0.5 billion] [Fell short of the revised estimate by ¥0.1 billion]
Net sales ¥10.5 billionAlmost the same as previous year [Reached 90% of the plan total and fell short of it by ¥1.1 billion] [Reached 101% of the revised estimate and exceeded it by ¥0.1 billion]
Peach John: Domestic sales improved thanks to the steady sales of regular products, closing of unprofitable stores and
suspension of publication of catalogs. Challenges remain for business in China.
(*Reference) Excludes impairment charges: -¥0.16 billion [Up ¥0.06 billion year on year] [Fell short of the plan total by ¥0.33 billion]
1Q 2Q 3Q 4Q total ratio
-13% -3% -11% +14% -4% 44%
-3% +10% +4% -1% +3% 56%
1Q 2Q 3Q 4Q total
-24% -31% -36% -23% -29%
+5% +2% +0% +30% +8%
Shanghai・Beijing etc(Directly Managed Store) -19% -24% -23% -23% -22%
Shanghai・Beijing etc(Third party EC site) +9% -48% -23% -33% -29%
-2% -41% -23% -30% -26%
◆Peach John Sales
by domestic business・Quarterly change
◆Peach John Sales
by overseas business・Quarterly change
★★Change rate based on local currency. The rate of increase or decrease in sales at retail stores and EC sites in each region.
(The figures for" Shanghai・Beijing etc" are from January to June.)
Japan Mail-order
Store
Overseas
★★
Hong Kong
Taiwan(stores+EC)
Shanghai・Beijing etc total
Resort wear
(A former name of Swimwear)-12% -21% +3% -27% -18% 68%
Innerwear +0% +0% -2% -1% -1% 32%
ratio◆Ai Sales by division・Quarterly change 1Q 2Q 3Q 4Q total
Manufacturing business
(A former name of Innerwear,Apparel Div.)+3% +3% +13% -10% +2% 75%
Material business
(A former name of Material,Art Hobby Div.)-9% -3% -19% -14% -11% 23%
EC planning and sales business
(Wacoal’s Own EC Site・Third party EC site)+20% +24% +16% +22% +20% 2%
ratio◆Lecien Sales by division・Quarterly change 1Q 2Q 3Q 4Q total
Rental and lease -13% -8% -10% -17% -12% 21%
Production sales -21% -21% -16% -32% -23% 16%
Construction -27% +33% -7% -13% -4% 63%
◆Nanasai Sales by division・Quarterly change 1Q 2Q 3Q 4Q total ratio
45
Overview of Domestic Subsidiaries for FY2020 (Lecien and Nanasai)
Operating income ¥0.2 billion [Down 23% year on year] [Reached 95% of the plan total] [Reached 85% of the revised estimate]
Net sales¥8.7 billion[Down ¥0.7 billion (-7%) year on year] [Reached 99% of the plan total and fell short of it by ¥0.1 billion] [Reached 97% of the revised estimate and fell short of it by ¥0.3 billion]
Nanasai: Sales declined due to the recoil of completion of large-scale interior work of a department store which occurred in the previous term.
Operating loss -¥0.5 billion[Down ¥0.1 billion year on year] [Fell short of the plan total by ¥0.5 billion] [Progressed according to the revised estimate]
Net sales ¥5.8 billion [Down ¥0.5 billion (-8%) year on year] [Reached 88% of the plan total and fell short of it by ¥0.8 billion] [Reached 99% of the revised estimate and fell short of it by ¥0.1 billion]
Lecien: Unprofitable businesses, including the apparel business, were withdrawn. OEM order for the core innerwear products turned positive.
46
Summary of the EC Sales Ratio of Each Major Company in FY2020
*The sales of Wacoal (Japan) products via third party EC sites are still to be calculated.
EC ratio YoY
Wacoal (Japan) Own EC channel only 5.0% +0.8pt
Peach John(Japan) Own EC channel only 39.8% -1.2pt
Wacoal America, Inc. Total of own company and
other companies' EC channels33.7% +5.4pt
Wacoal Europe Ltd. Other companies' EC channel only 20.5% +2.4pt
Wacoal China Co., Ltd. Other companies' EC channel only 23.8% +3.3pt
FY2020
47
Information within this document with respect to business plans, forecasts, strategies and
other statements, including business performance figures, is based on Wacoal’s assumptions
in the light of the information currently available, and in no way precludes the uncertainties
and risks inherent in these forward-looking statements.
Furthermore, actual business results may, as a result of numerous factors, differ significantly
from those expressed in statements in this document.